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Growing Communities Through the Benefits of Public Power

A community's economy is only as healthy as its local industries. Likewise, local businesses fare best in an economically healthy community. Cities served by publicly owned utilities have an ally fighting on both fronts.

Steve Kaelble, Staff Editor, Area Development

Winter 2012

Communities Make Public Power Strides

From coast to coast, public power companies are helping the businesses and citizens in the communities they serve to save energy - and money. They are helping companies to track their energy usage, install more energy-efficient lighting, and keep their roofs cool. They are also making sure their power plants meet strict air-quality standards. And local residents who also want to reduce their carbon footprint are being offered incentives to do so. These utilities are committed to growing their local "green" economies.

Building the New Energy Economy in San Antonio(2/9)

Sunny San Antonio is a leader in the so-called "green economy," according to the San Antonio Economic Development Foundation.
A project involving public power provider CPS Energy is helping to light the way. CPS Energy has agreed to buy large quantities of zero-emissions solar power from one of the nation's largest solar projects, which features a consortium involving OCI Solar Power and manufacturer Nexolon. The players plan to not only generate lots of solar power, but also to build major manufacturing operations in San Antonio. Adding to the excitement, both OCI and Nexolon are moving headquarters facilities to San Antonio.

Historians say Thomas Edison didn't actually invent the light bulb,
but was first to develop a truly practical, long-lasting incandescent bulb, way back in 1879. A revolution in lighting is under way again - technologies from the past 10 years can cut lighting bills by up to
60 percent.
Nebraska Public Power District wants to get those technologies into business customers' facilities through its EnergyWise commercial/industrial lighting program. Businesses that replace an older fixture with a high-efficiency alternative can apply for generous incentives worth up to $60 per fixture. That's an instant reward, but just as rewarding are the long-term cost savings delivered by more efficient lighting.

ElectriCities: Taking the Temperature of Energy Bills (4/9)

Information is power. And information about power is a powerful way to save money on energy bills. ElectriCities - a membership organization serving public power communities in North Carolina, South Carolina, and Virginia - helps customers of its more than 70 public power utilities get a better handle on how extreme cold or hot weather trends can impact their electricity usage and costs. The TempTracker365 weather calendar system quickly generates customized, colorful records of temperature trends covering the organization's public power cities and towns, for any month during the past few years. Businesses and public power customer service representatives can use the data, along with information from energy bills, to gain a better understanding of their utility costs. The system also delivers season-appropriate energy-efficiency tips.

Charging Up Electric Vehicles in Los Angeles(5/9)

Lots of people really want to reduce their carbon footprint (or maybe wheelprint) by driving an electric vehicle (EV). Being able to afford it is another matter entirely. The Los Angeles Department of Water and Power wants to ease the way, and offers customers a home charger rebate of up to $2,000. The utility also offers special electric service options for customers who drive an EV, and it's trying to make the experience as successful as possible by upgrading more than 80 city-owned public charging locations for those who need some juice while away from home.

Clearing the Air in Colorado (6/9)

Colorado is famous for its crisp, clean air and stunning mountain views. Colorado Springs Utilities wants to keep it that way, and has been ahead of the game in ensuring that its power plants meet strict air-quality standards. In fact, though the EPA has issued more stringent emissions standards, CSU's facilities are already in compliance. What's more, CSU is planning another $200 million worth of upgrades in the next five years to make its plants even more planet-friendly, while at the same time boosting the use of renewables such as wind power. The utility is a founding member of the Climate Registry, which tracks greenhouse gases.

Long Island:Cooling the Roof to Lower the Bill (7/9)

Industrial facilities often have huge, sprawling buildings sitting under acres of roof. The roof isn't a pleasant place to be on a hot, sunny day - and if you think about it, a roof that hot is bound to heat up the inside of the building, too. That's why the Long Island Power Authority encourages its business customers to cool their roofs. The right roofing materials can reflect the sun's heat and radiation and keep it from being transferred into the building, and that can mean significantly lower energy bills. To help encourage cool roofs, the utility offers generous rebates for both new and existing construction.

Powering Up Memphis Economic Development (8/9)

MLGW - the Memphis Light, Gas, and Water Division - is committed to building the local economy. That's why its economic development department for more than 30 years has shared space with the local chamber of commerce, so that staffers of the two organizations can work side-by-side on boosting prosperity in Memphis. They're there for local companies hoping to expand or improve their bottom line, as well as for businesses seeking a site for a new facility.

"Public power" is a term often used to describe electric utilities that are owned by the community and operated by local government on a not-for-profit basis. But you could just as accurately understand the term in a less literal sense. The "power" to foster prosperity, to support the local economy, to provide responsive and reliable service.it rests with the "public," not a sometimes far-away owner trying to turn a profit. It's a distinction that can make a difference on the bottom line, as businesses located in public power communities have found out.

"We are in the business of making our communities better places to live," says Tony Cannon, chief operating officer at Greenville Utilities in North Carolina. They're also in the business of making communities better places to do business, he adds. "By selecting a public power community, businesses can get flexibility and responsiveness. We don't have people knocking on the door all the time, so it's a priority for us."

More than 2,000 community-owned electric utilities collectively serve about 46 million American people, according to the American Public Power Association. Lots of them are smaller communities, but some major cities also benefit from public power, including Los Angeles, San Antonio, Seattle, and Orlando. So does the entire state of Nebraska.

A Message From Bill Carroll, Chairman, American Public Power Association

Public Power: Familiar, Accountable, Reliable, Affordable

If energy is important to your business, you should locate in a public power community. With utility services provided by a local organization, your company will benefit from a supplier who is accountable to its customers. In a public power community, the customers are the owners of the utility. The management and staff of the utility live in the community and have a personal relationship with their customers. Energy policy is set by an elected or appointed governing board that is accountable to the citizen-owners.

That proximity to customers assures highly reliable electricity service. Utility personnel know they will see their customers around town - at the grocery store, the health club, or school - and they do not want to risk the embarrassment that would accompany an extended power outage. With a focus on a compact, local area, public power utilities maintain and operate electric distribution systems designed to assure that energy continues flowing to customers when bad weather hits.

Businesses in a public power community can tap the expertise of local utility personnel when remodeling or expanding a facility. Utility staff can analyze a business' needs, determine the right voltage, and number and position of feeds into an industrial or commercial site. A community-owned electric utility cares about its customers and recognizes and shares your desire to keep operations running 24/7, if necessary. The utility will work with its customers to avoid even momentary power interruptions.

That expertise extends beyond just design of electricity feeds. Community-owned utility personnel will work with customers to assure that electricity is used as efficiently as possible. Lighting design, building envelope standards, motor sizing all affect the amount of money you spend on electricity. Your local electric utility wants your business to be successful and to help grow the local economy.

Familiarity. Accountability. Reliability. Affordability. These are the characteristics of public power utilities that appeal to businesses. Our customers know: public power is good for business. I invite you to find out for yourself.

These public power utilities are each a little different, just as their communities are different from one another. In general, though, they're governed by a city council - or perhaps by a separate board of local residents and businesspeople who are elected or appointed. Either way, they're answerable to local people, including their local customers.

The Right Rates
If the goal is helping businesses to prosper, a great place to start is by leaving more money in their bank accounts. "We can offer the lowest wholesale electrical rates in the state," says Susan Borries Reed, manager of economic development and member services for the Indiana Municipal Power Agency (IMPA), which provides public power utilities with energy and services. "We're attractive for manufacturing due to the competitive rates."

"Our rates are about 25 percent lower than the national average," agrees Roger Christianson, manager of economic development for the Omaha Public Power District (OPPD). Similar situations hold true across the country, where public power rates tend to be nicely competitive compared with rates of investor-owned utilities.

How can they hold rates as low as they do? For starters, profit motive. Or to put it more accurately, lack of profit motive. Public power providers don't have investors who expect a return on their investment. "As a public power entity, we don't have stockholders, so the money we make goes back into the business to increase reliability and keep rates low," Christianson explains.

In fact, those local governing boards that make the decisions are motivated to keep rates as low as possible. That commitment enters into most of the decisions that they make.

For example, Reed mentions her agency's decision to invest in state-of-the-art, coal-fired technology at a plant that happens to sit right next to a 30-year supply of coal. In an era of volatile energy prices, "we have a predictable cost of fuel," she notes.

The Right Assistance
Low rates are just part of the bottom-line equation. The other way to lower utility bills is simply to use less energy. Sounds simple, yes, but it's easier said than done. That's why many public power providers offer energy-efficiency assistance to their commercial and residential customers. They'll help customers uncover ways to cut their usage, and often will even help pay to make it happen.

Take Greenville Utilities' E-300 program that helps residential and business customers alike achieve outstanding efficiency. It begins when builders submit a plan to an energy specialist, who runs a computer load calculation and makes recommendations for insulation improvements and other efficiency measures that range from HVAC enhancements to solar orientation to more efficient lighting. The structure is inspected throughout the building process, and if its efficiency meets the requirements, the owners are rewarded not only with lower energy bills but also cash incentives. The E-300 program has been around for more than three decades, the longest-running program of its kind in the country.

Then there's the W.I.S.E. program in Oklahoma - that's short for "Ways I Save Energy." Jennifer Rogers, media specialist with Oklahoma Municipal Power Authority (OMPA), says the program offers both loans and rebates to customers who install energy-saving heat pumps. The most generous incentives, up to $800 per ton, are awarded for the use of geothermal heat pumps, but those who pick air-source and dual-fuel heat pumps also cash in. Even standard air conditioners are worthy of rebates if they're efficient enough.

Oklahoma Municipal Power Authority's Demand and Energy Efficiency Program (DEEP) is potentially even more generous. The program, which OMPA member utilities can offer their customers, encourages commercial users to take whatever steps they can to reduce their electric load, such as installing high-efficiency lighting, pumps, motors, compressors, chillers, and HVAC units. Rebates with matching funds can total as much as $100,000 a year. "If they're installing lights, chillers, upgrading motors, we calculate a way to get them some money," Rogers says.

It may sound counterintuitive for a business - even a non-profit, publicly owned one - to work so hard to sell less of its product. But consider what it costs to build power generation facilities, and it starts to make a bit more sense. "It helps us to put off the need for additional generation," IMPA's Reed says. And that's good for all parties involved.

The Right Attitude
"The public purpose piece is important," Reed says. There's no split allegiance between stockholders and customers. "We're answerable to ratepayers." And those ratepayers, whether residential or commercial, tend to be neighbors because of the highly local nature of public power, she explains.

"We have the benefit of having local people living in the community where they provide service to manufacturers and other industrial customers," Reed says. "You go to church with these people, and there's a lot of interaction. And they care about you being part of the tax base. Keeping business and commercial customers in the community is important to the tax base and to the health of the overall community. People have a real sense of appreciation for industry coming here, so they work very closely to make them happy."

OPPD's Christianson adds, "Our board comes from around the 13 counties we serve.They're friends and neighbors and are a phone call away."

Local decision-making can translate into an increased ability to negotiate the right deal for business customers, according to Greenville's Cannon. "We can get very creative. With local governance and a local board of directors, we have local approval of incentives."

"We have a little more flexibility when it comes to things like putting rates in place," explains Reed. "Municipalities can go through a local ratemaking process and have a little flexibility in adopting rates. It allows them to be a little more nimble than investor-owned utilities can be."

That customer-focused attitude often includes especially attentive service for large, industrial customers. "We can work one-on-one with industrial customers and get a sense of what will help them get their overall costs down," Reed notes. Christianson says OPPD also has account executives who work with the largest customers.

Steve Kaelble, Staff Editor, Area Development

Steve Kaelble has written for Area Development for more than 20 years. His work has also appeared in numerous other magazines, newspapers, and online publications, as well as broadcast media. He has authored several books and has worked extensively in corporate and internal communications, including creating annual reports. An Indianapolis resident, he holds bachelor's and master's degrees in journalism from Indiana University.